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Tips For Avoiding Legal Troubles When Selling Your Home


Bob and his wife Ann purchased a home in Little Town, USA. Before purchasing the home, they inspected the home and the sellers assured them that there were no problems in the home – both cosmetically and structurally. The house met their expectations, according to the seller’s representation of the home.

After Bob and Ann moved into the house, they discovered that when it rains, there is a terrible leak in the roof. They additionally found out that the seller had repaired the issue, but the repairmen had just simply patched up the hole and painted over the ceiling stains. The result? A seven year law-suit against the seller.

What type of disclosures should the seller make?

The best advice to follow is when in doubt, disclose. In order not to wind up like the seller of Bob and Ann’s home, it’s important to make the buyer aware of everything. In the above example, the seller should have warned the buyer's about the repair. A seller should disclose ANY minor or major problem with the house. If the defect is not obvious, then the buyer may not have the opportunity to discover it. Therefore, in order for the seller to protect him or herself from liability, the safest bet is report any known problems.

These problems can involve the structural or even the cosmetic conditions of the house. They can include problems such as:

  • Ceiling or Roof that leaks water
  • Termites or any pests
  • Issues involving the plumbing, air condition, walls, floors, windows, electrical unit, or exterior such as sidewalks, lawn, driveway, etc.
  • Zoning ordinance violations
  • Building code violations
  • Deaths that occurred on the property
  • Interior Flooding

Does the seller’s real estate agent have a duty also?

The seller’s agent represents the seller, and therefore has the same responsibility to disclose to the buyer any problems with the condition of the house. They are NOT permitted to conceal these problems. Additionally, the seller or his agent may be liable to the buyer for damages in a lawsuit. These damages include but are not limited to:

  • Equitable Relief: a court order that the seller should or should not take a certain action. This differs from the other type of damages which are monetary.
  • Non-Economic Damages: compensation for pain and suffering
  • Economic Damages: expenses that were made out of pocket such repairs or even lost profits as a result of the defect
  • Punitive Damages: involves intentional and serious non-disclosures and awards compensation to deter future wrongdoing

Should the seller conduct a property inspection?  

Home inspections are one of the leading issues for a real estate deal to fall through. As recently explained here, home inspections help to discover material and nonmaterial defects in a home. A home inspection is very useful for sellers. The home inspection can make the seller and the buyer aware of the defects in the home.

The seller can choose to repair and fix these defects, or they can attempt to sell the home with them. However, those sellers who wish to sell the home in it’s current condition (with existing defects), should certainly disclose the inspection report to the buyer. This relives the seller from liability, since they are making an active effort to disclose defects from a professional inspection.


Tips For Avoiding Legal Troubles When Selling Your Home curated from Forbes - Real Estate

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